Case solution
Aloha products
Aloha Products is a United States-based coffee-processor company that has been providing non-specialty and low-priced coffee for over a hundred years. It purchases the raw materials or what buyers and sellers refer to as “green coffee” from brokers and trade firms then processes the coffee and sells the final product to customers. Large companies such as Nestle and P&G directly import the unprocessed or green coffee beans from coffee plantations in tropical countries such as Brazil and Colombia while companies with smaller levels of business such as such as Aloha buy the green coffee beans from brokers or trade firms.
Aloha Products is managed by the owners and its headquarters is located in Ohio, United States. It has three plants located in Midwestern United States, each plant being responsible for its own profit and loss. Each plants performance is measured by each plant managers gross margin generated per plant. The raw materials or green coffee beans are handled by the company’s purchasing unit that is located in New York City. Each plant receives a production schedule that is determined from the center and receives raw materials as well as pay in accordance with the production requirements of each plant.
Aloha’s Top management is regulated by the members of the founding family. Company uses centralized control system where all main decisions regarding purchases, production, sales, marketing and promotion are made on corporate level while plant managers are only responsible for their profit and loss. Also there is centralized preparation of overall financial statement at home offices. This organization has led plant managers to a lack of adequate control over the activities of the managed plant; however, they are still assessed on the performance. This method has been done until in the 1990s, when the plant managers started to speak out on their dissatisfaction on the computation of their bonuses since they do not have authority to
Aloha Products is a United States-based coffee-processor company that has been providing non-specialty and low-priced coffee for over a hundred years. It purchases the raw materials or what buyers and sellers refer to as “green coffee” from brokers and trade firms then processes the coffee and sells the final product to customers. Large companies such as Nestle and P&G directly import the unprocessed or green coffee beans from coffee plantations in tropical countries such as Brazil and Colombia while companies with smaller levels of business such as such as Aloha buy the green coffee beans from brokers or trade firms.
Aloha Products is managed by the owners and its headquarters is located in Ohio, United States. It has three plants located in Midwestern United States, each plant being responsible for its own profit and loss. Each plants performance is measured by each plant managers gross margin generated per plant. The raw materials or green coffee beans are handled by the company’s purchasing unit that is located in New York City. Each plant receives a production schedule that is determined from the center and receives raw materials as well as pay in accordance with the production requirements of each plant.
Aloha’s Top management is regulated by the members of the founding family. Company uses centralized control system where all main decisions regarding purchases, production, sales, marketing and promotion are made on corporate level while plant managers are only responsible for their profit and loss. Also there is centralized preparation of overall financial statement at home offices. This organization has led plant managers to a lack of adequate control over the activities of the managed plant; however, they are still assessed on the performance. This method has been done until in the 1990s, when the plant managers started to speak out on their dissatisfaction on the computation of their bonuses since they do not have authority to